Usw Gives Up 550 Local Jobs, Accepts Pledge

May 07, 1986|by PAUL WIRTH, The Morning Call

The United Steelworkers union has agreed to cut 550 jobs at Bethlehem Steel Corp.'s local plant in exchange for a company pledge that primary steelmaking will remain open at least through December 1989.

In a last-minute settlement yesterday, Bethlehem Steel promised to pay a penalty of up to $10 million if it breaks the agreement. The company also has agreed to further reduce its non-union employment costs.

Permanent job reductions will begin immediately in 41 plant departments, according to Marvin Peters, union staff representative who negotiated the pact. He said work rules and practices will be changed and jobs will be combined to reduce the work force. The cuts should be completed by the end of the year, he said.

The agreement is the best way to minimize job losses while keeping the entire plant intact, Peters says. Bethlehem Steel, which originally wanted 800 jobs from the union, had threatened to eliminate primary steelmaking and discharge 1,300 workers if the union didn't agree to the cuts.

Peters said the negotiations were touch-and-go right up until the time he left for Pittsburgh yesterday toresume company-wide contract talks. The final agreement was delivered to him by Bethlehem Steel messenger as he waited in line at the Allentown-Bethlehem-Easton Airport for his 3 p.m. flight.

The union's 43-member executive committee rejected a company proposal Monday night because it lacked a firm guarantee that the plant's so-called "hot end" would remain open, Peters said. In a second vote, the committee authorized Peters to agree to the cut if the guarantee was strengthened.

Peters met with company officials at 10:30 a.m. yesterday to present the union's position. Two hours later, without a commitment from the company, Peters walked out and went home. A telephone call later from plant officials informed Peters that the company would provide the guarantee.

No further vote is needed by union officials. The agreement remains tentative until final details are worked out by the union's legal department, according to Peters.

While the agreement preserves steelmaking for only 3 1/2 years, Peters says it can be renegotiated when it expires. He says the job cuts will provide adequate savings to the company to justify keeping the hot end open.

If the company closes the hot end before the end of the agreement, it will pay penalties to the 550 workers who lost their jobs needlessly, Peters says. The company's liability, set at a maximum of $10 million, decreases over time through the term of the agreement, according to Peters.

To eliminate the jobs, retirement incentives or a buyout worth $1,000 for every year of service will be offered to employees on a seniority basis, Peters says. If enough employees don't leave voluntarily, forced layoffs will be enacted.

Those employees laid off will be eligible for unemployment compensation and, in some cases, supplemental unemployment benefits, Peters said. Those taking layoff will have full recall rights if the industry rebounds, according to Peters.

In justifying the union's agreement to eliminate 550 of the plant's 3,600 union employees, Peters said it was the only way to keep the entire plant alive. "The only hope we have of continuing to be a major steel producer is to keep hot metal open," he said.

The plant's hot end includes the blast furnace, basic oxygen furnace and coke ovens. A hot metal shutdown would have meant that chunks of steel from other plants would be brought to Bethlehem for reheating and rolling into shape.